Radiology Gets a Smaller Slice of the MPFS Pie

Gregory N Nicola, MD, FACR; Lauren P Golding, MD


Appl Radiol. 2021;50(1):28-30. 

In This Article

CMS Response

CMS received the RUC recommendations for values of the revised outpatient office-based CPT codes in April 2019, traditionally too late for CMS to include or comment on in the following year's MPFS. Unexpectedly, the 2020 final rule for MPFS accepted and finalized the RUC recommendations, and set a start date of 2021, even though the rules generally concentrate on payments only for the prescribed calendar year. This was presumably because CMS was aware of the significant impact the revised values would have on the physician fee schedule.[11]

The new valuations for E&M must be viewed in a more global context of the MPFS in order to grasp these ramifications. CMS is required to maintain budget neutrality inside the MPFS for all current and revised services. Because the outpatient E&M codes fell within this budget neutrality requirement, CMS was not permitted to seek new monies from Congress, but instead had to make adjustments to the overall MPFS to allow for higher outpatient E&M payments.

CMS determines payments to clinicians with two major inputs.[12] First, it uses the RVUs assigned to a service (with input from the RUC). It subsequently multiplies those RVUs by a conversion factor (CF), which is a dollar amount paid for each RVU set each year for the entire fee schedule. The total number of expected RVUs for an upcoming payment year, multiplied by the CF, must equal the amount of money CMS has available to pay out for that year. If the total RVUs rise (as in this case the RVUs assigned to outpatient E&M), then the CF must fall.

Most of the time, revalued services have a negligible impact on the CF owing to yearly compensatory adjustments for inflation, as well as savings for services which had RVUs devalued for the payment year MPFS. Additionally, most services that are valued upward make up a small fraction of the overall MPFS or have their RVUs only slightly adjusted upward; therefore, they do not require large shifts in dollars to meet the higher RVU allotment. This is not the case for outpatient E&M. This family encompasses 20% of the MPFS, and the RVU values were adjusted upwards of 20–25%.

CMS was aware that the dollar shifts would significantly reduce the CF, and it needed to get the message out early so that the house of medicine could prepare. In the 2020 final rule, CMS projected an 8% reduction in payments for diagnostic radiology, as well as a wide range of payment reductions and increases for the major specialties, depending on the number of outpatient E&M services performed and billed by a clinician.[13] For example, CMS estimated an endocrinologist would have a payment increase of 16%, even though the conversion factor was decreasing solely because the endocrinologist had higher RVUs for standard work centered primarily on outpatient E&M, which offset the CF decrease.

Radiologists could not make up the new CF deficit, as the RVUs for our standard services remained the same. CMS finalized RVU increases for the revised outpatient E&M compared to existing values as demonstrated in Table 2. The exact dollar payments will be higher, but calculations depend on a variety of additional inputs, which CMS has yet to make publicly available.